Ed Randolph and his wife were heading back home to Plano from the Dale Chihuly glass sculpture exhibit at the Dallas Arboretum when the storm hit with fury. With visibility shrinking, many cars pulled off Central Expressway to wait out the sheets of rain. Others sped dangerously through the weather in a rush to avoid the delays.

The Randolphs slowly steered their 2007 Toyota Avalon north as hailstones smashed the front windshield, shattered the rear window and pierced the decking below. Ice balls cratered the car’s front fender, leaving a dent about 4 inches wide. “That was the most scary thing I’ve been through in my life. It all came out of nowhere,” said Randolph. “We had our own glass exhibit in the car.”

The June 13 storm was so severe, it damaged about 70,000 vehicles and left about $500 million worth of vehicular damage, according to the Insurance Council of Texas.

Randolph, who had been perfectly content with his car before Mother Nature attacked it, wasn’t happy when he heard from his insurance adjuster. Southern County Mutual Insurance Co., which underwrites auto programs in Texas through Hartford Fire General Agency, declared the car a total loss.

“But they don’t offer enough to purchase a similar vehicle,” Randolph said, adding that repairing the damage also would be costly. “If we choose to keep the vehicle, they reduce the check by a $10,000 salvage value, leaving us thousands short of the repair estimate.”

Thinking the salvage value was highly inflated, Randolph brought his case to supervisors. He wrote to the companies to complain and he threatened to file a complaint to the Texas Department of Insurance. He also contacted me.

“Basically that just steals equity from the cars’ owners,” he said. “This could be a big issue in Texas right now because of all of those claims coming in. A lot of people are going to get cheated. These things are being evaluated apparently as mild hail damage and my car looks like it was driven through Baghdad on a bad day. This is the most severe damage I have ever seen on a vehicle.”

Salvage values are seemingly subjective and there is no insurance industry standard formula. They are basically the dollar amount that the insurer says it can recoup by selling the vehicle through a vendor. But how the number is determined varies widely. Some insurers base their decisions on percentages of the car’s total value, along with damage. Others have salvage companies provide the estimates.

The end number is important. If the car is totaled, but the owner wants to keep and repair it, the insurance company gets to deduct the salvage value from the total payout.

For instance, Randolph’s car was valued at roughly $16,700 and assigned a salvage value of $10,000. After subtracting his $500 deductible, that would leave him with a $6,200 insurance payment to fix the hail damage. “It would cost me a minimum of $9,000 to fix the car. They make it almost prohibitive for me not to total the car,” he said. “We’re not trying to make a killing. We’re just trying to get our car fixed without throwing in another $3,000.”

In Randolph’s case, the salvage value was assessed by a contractor called Copart Inc., which processes salvage vehicles at facilities nationwide and auctions them off online for the insurance industry, finance companies, banks and rental car companies. The company provides estimated salvage values based on recent sales of similar vehicles. Copart has an extensive list of hail-damaged vehicles located in the Dallas area, including a 2007 Toyota Avalon with a salvage vehicle title and an estimated repair cost of $8,706. The car is expected to sell by Aug. 8

With the give-and-take that seems to go into the salvage values, I put in calls to Southern County Mutual and to The Hartford Financial Services Group Inc. to ask about the figure assessed for Randolph’s car. A few hours later, Randolph received an email stating that his salvage value was reduced to $5,004.90 based on the substantial hail damage to the vehicle.

Hartford spokesman Thomas Hambrick said that if anyone has “questions about the salvage value of their vehicle or thinks the value is inaccurate, they should contact their claims adjuster who will be more than happy to discuss the valuation process and consider any additional claimant information for submission in connection with the claim.”

Randolph will now receive a total of $11,203.10 to fix his car. He is in the process of choosing a body shop for the repairs. Estimates are coming in higher than they were when he initially researched repairing the car. He knows that he will bear the cost of the repairs if they are more expensive than the money he’s getting from the insurer. But he said he was still pleased with the result since he’s not forced to accept the totaling of his vehicle.

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